Friday, April 28, 2006

Drug Approval For Genzyme

Genzyme received some good news today with the FDA approval of Myozyme, which is used to treat patients with Pompe’s disease. Myozyme is an enzyme replacement therapy and essentially replaces the missing enzyme, acid alphaglucosidase, in these patients. This is an orphan drug with ~ 5,000 to 10,000 patients affected with this disease and the company has exclusive marketing rights in the US for 7 years with no competition. The company has already received EU approval. The pricing for this drug will be ~ $175,000 to $250,000 per year. Analysts are expecting this drug to generate revenues of $27 million this year, $84 in 2007, $145 in 2008 and $193 in 2009. The drug has potential blockbuster status with $1 billion in peak sales, but it will take awhile. The next potential market moving news for Genzyme will be Analyst Day, which will be held on May 12th.

With the Q1 revenues and earnings short fall, I would not buy this stock until I see the Q2 numbers.

Wednesday, April 26, 2006

Another Condo Update

I haven’t given an update on the condo for a while, so here goes… Everything is still on plan for the November 2007 completion, yes you heard right November 2007! Yeah, it’ still a very long ways off, but it’s slowly coming along. The only negative about this long completion date is the inability to lock in today’s mortgage rate. I was able to lock in a 30 year fixed rate mortgage of 7% for this project, but I had to pay 1.5 points for this lock. It’s expensive, but it’s an insurance against rates going through the roof. I still have the ability to lock in at a lower rate within 6 months of closing. So I’m hoping that rates plummet when it’s time for me to close. Anyways, here’s the construction update:
  • Underground plumbing is complete.
  • Structural slab-on-grade is complete.
  • Forming and placement of foundation walls is in progress and approximately 50% complete.
  • Completion should be by first week of May.
  • Start of structural steel is now targeted for May 8th.
  • Façade mockup complete except for caulking.
  • Projected building completion date is 11/11/07.

Thursday, April 20, 2006

Genzyme Recovery

Genzyme (Ticker: GENZ) recovered a bit today and closed up 2% to close at $61.87 after yesterdays little earnings disappointment. The CEO of Genzyme, Mr. Termeer, called the stock decline a "massive overreaction" and said the company was sticking to full-year earnings guidance of $1.78 to $1.88 a share. Like I said before, the stock will be dead money until we see the Q2 numbers. I accept the company’s explanation for the revenues and earnings short fall. I’m not selling any shares at these levels.

Wednesday, April 19, 2006

Genzyme Miss...

Alright, I admit my mistakes and was wrong on Amgen (Ticker: AMGN) and Genzyme (Ticker: GENZ). Genzyme reported today and missed pretty big on both the revenues and earnings per share. The company's revenues increased 16% to $730.8 million, but that was below analysts expectations of $749 million. The earnings per share came in as $0.59 per share vs. expectations of $0.63 per share. The Street punished the stock by sending it down 7.6% to $60.78. The company reiterated it’s guidance for the year so it's expecting much better numbers in the upcoming quarters. The stock will not do much until we see the Q2 results. So in the mean time, I’ll avoid Amgen and Genzyme, but will continue to pick up Genentech on weakness. Yeah, Genzyme is my largest position…

Tuesday, April 18, 2006

Amgen Reports

Amgen (Ticker: AMGN) just reported after the bell today and it was a good quarter; not great… The company reported revenues of $3.127 billion vs. estimates of $3.34 billion. Revenues still grew a healthy 14% and EPS came in at $0.91, which beat estimates by $0.03 due to expense controls. Even though revenues came in a bit light, I still like the numbers and I think investors were expecting something worse. The stock is currently trading down a bit in after hours. Hopefully the conference call will clear up some uncertainty so the stock can trade higher.

Tomorrow, we have Genzyme (Ticker: GENZ) reporting in the morning.

Saturday, April 15, 2006

Waiting For Earnings

I’m in a holding pattern right now. All those short-term trades really wore me out… just kidding! Actually this is going to be a big week for earnings. The following companies in my portfolio are going to report: Amgen (Ticker: AMGN), Genzyme (Ticker: GENZ) and Pfizer (Ticker: PFE). Amgen and Genzyme have corrected quite a bit so any good news will send those stocks up. I’m looking for slight upside surprises from both Amgen and Genzyme. Pfizer, I don’t know… hopefully they’ll decide to spin off their consumer products division to shareholders instead of an outright sale to another company. But that’s about it from me until we see the earnings reports.

Wednesday, April 12, 2006

Good Earnings From Genentech

Genentech reported very good numbers yesterday, but the stock sold off a bit today. I couldn’t see anything wrong with the earnings report. The company reported EPS of $0.46, which beat the consensus estimate of $0.41 and revenues increased 36% year over year. The company raised guidance for the year to 45-55% EPS growth. Genentech’s currently trading at ~43X this years earnings and ~32X next years earnings. Its long term growth rate for the next couple of years is 30%+ growth. In another words, Genentech is pretty cheap right now. If the stock declines further, I’ll back up the truck. I almost never buy a stock that’s declining, but I have a strong conviction in Genentech. You sometimes have to go against the crowd to make some $$$.

Monday, April 10, 2006

More Short Term Trading!?

My short term trading saga continues… Today, I sold Apple @ $69.35 (Ticker: AAPL) and netted a return of 8.60% over a 7 day period. I used the cash from the Apple sale and picked up some more Genentech (Ticker: DNA) @ $80.83, which reports tomorrow after the bell. The question is how big Genentech will beat the Street estimates? The Street is looking for revenues of $1.97 billion and eps of $0.41 / share. I think they'll easily beat the Street in both revenues and eps. There's also pretty strong technical support for Genentech around the $80 area.

Saturday, April 08, 2006

Back From Vacation

I’m back from a mini vacation and I’m a bit out of synch as to what has happened to the market over the past few days. The biotechs continued to get trashed big time. I’m not sure what the reason is for this move, but this sell off in the biotechs is way overdone. I’m just not willing to catch a falling knife just yet, but Genentech (Ticker: DNA) reports on Tuesday and this could be the catalyst for the group. In the mean time, if you want exposure to the group I would buy the Dynamic Biotech and Genome Powershares (Ticker: PBE).

The only positive move in my portfolio was Apple (Ticker: AAPL). I’m up ~ 10% in ~ 1 week. Hmm… one last short term trade, ok? I may take my profits in Apple. We’ll see on Monday.

Tuesday, April 04, 2006


I have a case of seller’s remorse. I sold Brookfield Asset Management and pocketed a small gain. Well, today the stock jumps 2.3% on the news of a stock split and a 50% increase in dividend payout. If I only held! This is what I get for trying to be smart and over trade. Oh well, I just have to forget about the past and move on...

Monday, April 03, 2006

A Few More Trades

Ok, I really mean it this time... No more short term trading! I sold Brookfield Asset Management (Ticker: BAM) for a tiny 3.29% gain. I held onto the stock for a little over 2 weeks. I decided to get back into the NASDAQ 100 @ $42.33 (Ticker: QQQQ). I also nibbled on some Apple @ $63.40 (Ticker: AAPL). So what was I thinking? Umm... ???

The big cap biotech's sold off today. There are a lot of people talking down the group. Earnings will be coming out soon for many of the biotech's and I have a feeling that they will report upside surprises. This is a good time to start nibbling at the big cap biotechs especially when everyone is negative for really no good apparent reason.